Arla announces proposal to invest EUR 107 million in UHT milk production in UK

Arla has proposed to invest EUR 107.7 million to create a new UHT Centre of Excellence at its Lockerbie site in Scotland. As a result of the proposed investment, there is a potential impact for some colleagues based across two UK sites, with a proposed closure at Settle.

Arla Foods has today announced a proposal to invest EUR 107.7 million into its Lockerbie site in Scotland, to support the farmer owned cooperative’s future growth ambitions.

The dairy cooperative is proposing to create a Centre of Excellence for the production of UHT and Lactofree milk at Lockerbie. UHT is milk that has been processed at a ultra-high temperature, which means that it does not require refrigeration until it is opened.

Speaking about the investment proposals, David Boulanger, Executive Vice President and Head of Supply Chain, said: “We have chosen Lockerbie as a future UHT centre of excellence in the UK as it allows us to build scale, drive significant efficiencies and strengthen our resilience. Located close to a large milk pool, Lockerbie brings additional sustainability advantages with our recently invested anaerobic digestion plants. The new investment will enable us to increase UK production capabilities in UHT and Lactofree technologies, supporting further growth with our strategic customers in the UK.”

As a result of the investment plans, there is a potential impact for some colleagues based at its Stourton site, and all colleagues at its Settle site, which Arla proposes to close. There are no immediate changes proposed, however the anticipated change date is from the second half of 2026, if the proposals go ahead.

David Boulanger continues: “This investment for Lockerbie implies that we are proposing to move some production from other sites in the UK and as a result, will potentially impact some of our colleagues in Stourton and Settle. At Arla we are committed to supporting all colleagues through periods of change and we understand that this will be a time of uncertainty for everyone who works across these sites. We will be entering into a period of consultation with all colleagues affected by these proposals.”

Mark Boot, Executive Vice President Europe at Arla Foods, adds: “Arla is one of the biggest food companies in the UK, and as a global dairy cooperative, we want to continue to grow within this market, whilst continuing to look for opportunities to create more value for our farmer owners’ milk. This investment comes on top of over EUR 355 million site investments announced in 2024 for the country. We have a responsibility to provide high quality dairy to our consumers and customers, and today’s news demonstrates Arla’s confidence in the future of British dairy.”

Today’s news follows Arla’s announcement in 2024 to invest over EUR 355 million across its UK sites, including EUR 210 million in a state of the art mozzarella operations in our Taw Valley creamery in Devon.